Few would deny that European Union foreign affairs chief Baroness Ashton has had a tough first year in the job created by the Lisbon Treaty. Criticised for perceived inaction over the Libya crisis (where the diverging views of EU countries made it impossible for her to speak on their behalf) and finding herself the victim of a ‘turf-war’ between the European Commission and the Council of Ministers over the creation of the new European External Action Service, her position has often been unfairly compromised by institutional wrangling.

However, over the weekend she chalked up a big diplomatic victory in the Balkans. Until the weekend, Milorad Dodik, the nationalist president of Bosnia’s Serb Republic entity, had been demanding a referendum on the legality of Bosnia’s national court. Dodik, who has often advocated the full independence of his region from Bosnia, had long argued that the national court, which prosecutes war crimes suspects, corruption, and organised crime, was biased against Serbs.

Ashton spent much of the past week in Bosnia negotiating with Mr Dodik who announced that the Serb Republic would abandon a referendum. In exchange, Ashton will lead a “comprehensive overview of the (Bosnian) judiciary”, stating that this was a necessary part of Bosnia’s moves towards future EU membership.

Meanwhile, Mr Dodik announced following the talks that:

“We understand this as the beginning of a dialogue on the judiciary, where the shortcomings in the work of the judicial institutions at Bosnia-Hercegovina level will be reviewed.”

The first session of this ‘structural dialogue’ on the Bosnian judiciary will take place in early June, and will be overseen by Catherine Ashton and the EU enlargement commissioner Stefan Füle.

More than 15 years after the 1993-95 war which ripped apart the former Yugoslavia, Bosnia, like the other Balkan nations, remains ethnically divided, governed according to the Dayton Accords which created two semi-autonomous entities: the Serb-dominated Republika Srpska and the Federation of Bosnia-Hercegovina. Like its neighbours, Bosnia remains a fragile nation.

Just weeks ago the parliament of the Serb Republic overwhelmingly backed proposals to hold a referendum on the court and its prosecutor. The referendum would also have gauged support for the presence of the EU’s special envoy to Bosnia, Valentin Inzko, a critic of Mr Dodik who had warned that a referendum would be “irresponsible,” could jeopardise the Dayton agreement and potentially lead to the collapse of the country.

The court was established in 2002 mainly to prosecute war crime suspects and ease the burden on the Hague-based International Criminal Tribunal for the Former Yugoslavia. Mr Inzko, an Austrian diplomat, has wide-ranging powers including the right to overturn laws and fire officials, although these are rarely used.

Lord Ashdown, formerly the international High Representative to Bosnia-Hercegovina, has often rightly described integrating the Balkans into the European Union as ‘unfinished business’. With Croatia close to fulfilling all of its accession criteria, and Serbia, Montenegro and Macedonia all now in the process of applying for EU membership and starting to look at how to adapt their national law and legal framework to the EU’s ‘acquis communautaire’, and tensions in Bosnia now reduced, that process is still on track.

Ashton’s coup in brokering a deal that keeps both sides of Bosnia at the negotiating table, and keeps the possibility of Bosnian EU membership alive, is a healthy reminder that ‘jaw-jaw’ is still the best method of diplomacy.